Auto insurance policies are packages of different kinds of coverage. There is some flexibility regarding the types and the amounts of coverage you choose. However, practically every government in the world has insurance laws that demand drivers to carry at least some insurance. Many states in the U.S., for example, even demand that the owner of the vehicle presents proof of insurance before registering his car. It means you will probably need to insure your used car, regardless of its value.

Almost every country in the world demands that drivers carry liability insurance. It provides financial protection from liability claims against the owner of the car, in case he causes an accident those results in injuries to others and/or damage to other people’s property. Usually, there are mandatory minimum levels of coverage in this area. These laws were created because the responsibility to compensate victims who suffer accident-related losses belongs to the drivers who are at-fault. But most of the times these minimum levels don't even come close to covering the costs of a grave accident. So, if you really want to be protected from liability claims, your liability coverage certainly should exceed these minimum requirements.

Some other coverage’s are optional in some countries. Medical payments coverage and uninsured/underinsured motorist coverage are good examples of such coverage’s. Medical payments coverage covers medical expenses incurred by you, your familiars, and your non-family passengers. Uninsured/underinsured motorist coverage, on the other hand, covers losses you and your passengers suffer as a result of an accident caused by a driver who has no insurance or whose insurance is not sufficient to pay for your medical expenses. If buying this coverage’s is optional where you live, base your decision on your particular needs and circumstances.

The collision and comprehensive insurance coverage is optional in almost every place on earth. The collision and comprehensive section of your policy covers physical damage to your car resulting from collisions and some other causes (like fire, falling objects, vandalism, etc.). It also covers losses associated with theft. However, your car's value plays the biggest part in determining your need for this type of coverage. It may not be cost-effective if your vehicle is extremely cheap, because you may end up paying more in insurance than you would pay to replace your vehicle.

Due to the same factor insurance companies have Cleary written in their terms and conditions that they will only insure cars which could pass through certain tests, several tests are involved, and these test of your car could examine them that they can insure it or not. Most of insurance companies do these examining tests, but there are very few working in UK and Europe, where one can insure his old car without any problem, but there are still certain rules to follow up, but the rules to follow are much simple then the cars examine test. Since old cars could create a terrible lose to insurance companies so standard insurance is not available for such cars.

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